On August 15, 2023, the IRS issued Notice MS-2023-03 that may extend your 1031 deadlines pursuant to IRS Revenue Procedure 2018-58 (Rev. Proc.).
Section 6 of the Rev. Proc. allows certain taxpayers to extend certain 1031 deadlines to October 16, 2023.
Section 17 of the Rev. Proc. allows certain taxpayers to extend certain 1031 deadlines to October 16, 2023 or 120 days – whichever is later (however, this extension cannot go beyond one year or the due date for the taxpayer’s tax return for the year of the sale, as extended).
As of August 15, 2023, the disaster areas are: Claiborne, Copiah, Covington, Jackson, Jasper, Jefferson, Jefferson Davis, Lawrence, Leake, Neshoba, Newton, Rankin, Scott, Simpson, Smith and Wayne Counties and the Mississippi Choctaw Indian Reservation, Mississippi.
Taxpayers meeting the definition of “Affected Taxpayer” are eligible for both the Section 6 and Section 17 extensions, regardless of the relinquished property and/or replacement property location and must choose which extension option to proceed under. The definition of “Affected Taxpayer” includes individuals who live, and businesses whose principal place of business is located, in the covered disaster area. The Section 17 extension is also available to taxpayers who are having difficulty meeting their 1031 deadlines due to the disaster (See Rev. Proc. Section 17.02(b)(ii) for examples of such “difficulty”).
For a more detailed explanation of the Disaster Relief extensions click here: apiexchange.com/disaster-relief/
All disaster declarations for which the IRS has provided an extension of 1031 deadlines can be found here: https://www.irs.gov/newsroom/tax-relief-in-disaster-situations
Taxpayers should consult their tax advisor to determine their eligibility for an extension and alert their Exchange Counselor as soon as possible of any extended 1031 deadlines.
